> 2. Does seizing the site, give the Feds the right to read through my files? what if I had been working on the next big super-duper idea, and they steal my ideas?

Regardless of precise laws (it will take years to make a precedent) it would seem extremely naive to assume that anything you upload could and will not be read by the federal authorities, or others (megaupload owners, some guy at your ISP, etc.)... This is one of the major issues with using 'the cloud' as a platform for anything sensitive, and doesnt get enough attention.